John Halligan (Waterford, Independent) | Oireachtas source

On the question of whether the knowledge development box, KDB, allows large multinationals off the hook in respect of tax, the answer is "No". The tax rate of 6.25% is on profits specifically arising from substantive research and development activities in Ireland that gives rise to the patents copyright software and an IPSS certificate under the Bill. The KDB has been developed in line with the OECD guidelines. The OECD Forum on Harmful Tax Practices has confirmed that the Irish knowledge development box is the first box in the world to be fully compliant with the rules. Applications to Revenue for the 6.25% relief under the KDB can be subject to random audits by the Revenue Commissioners, and I said this on Committee Stage. The Members can see where the 6.25% arises. It is for research and development activities in Ireland.

Deputy Boyd Barrett spoke about the figure of €7.5 million. We have to be in a position, regardless of who is in government and no matter from where we come, to invest in research and development. I have visited many research and development operations and they require major investment to get them off the ground. I believe Deputy Lawless would confirm that. Investment of €2 million, €3 million or €4 million has been made in operations where only four of five people are employed. Many of these are high-tech operations. I have seen such operations throughout Ireland. I do not consider €7.5 million to be a huge amount in that sense. Deputy Boyd Barrett and anybody else is welcome to come along with me to meet some of the industries and the groups.

Deputy Lawless raised the issue of the non-disclosure obligation on the controller preventing the release of details of an invention and spoke about those who may have an application for funding rejected. We have found that individuals and researchers and developers in small companies want to hold tightly onto a product in the hope that they can further develop it and even those who have been rejected funding from wherever they have sought it would want to keep tight about what they have discovered or developed and would not want it to go into the public forum. That is why that is covered in that section.

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